Fit for Circulation: The Future Lifecycles of Currency to 2026

Across the world cash cycles – how central banks, distribution partners and users handle banknotes and coinage – are evolving rapidly.

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Product detail
Product type: Market report
Date of publication: 31 Jul 2016
Product format: Hard Copy, Digital Copy

Cash cycles are seeing technology developments: including the transition to polymer substrate banknotes, increased automation of the retail bank experience, international adoption of GS1 cash management standards and the implementation of improved dye-ink security features.

This report from Smithers Pira analyses these changes and how they will impact the activities of all cash cycles participants – including banknote printers and suppliers of security print consumables – from 2016-2026.

Description

Our exclusive content:

  • Key trends and technologies influencing the future lifecycles of currency
  • In-depth analysis of the main technology trends and central bank strategies affecting the global use of currency to 2026
  • Over 70 tables and figures providing analyses of key drivers shaping the industry.

What methodology is used?

Fit for Circulation: The Future Lifecycles of Currency to 2026 is based on extensive primary research conducted with key decision makers and specialists at central banks, technology supplies, and leading industry consultants.

This was supported by extensive secondary research on the future of cash cycles in the form of official and private databases, supplier websites and brochures, technical articles, papers and conference proceedings.

Key data on future currency print volumes and cash cycle strategies are provided to contextualise and illustrate the transformative trends identified by the report.

What will you discover?

  • Why the use of cash will survive the threat of electronic payments, and the growth in world cash demand for the next 10 years.
  • The key trends and unmet demands in cash cycle management, and the design and production of banknotes and coinage for the 2016-2026 time period.
  • How cash cycles in all economies will transform across the next 10 years with illustrative national examples of Germany, Poland and Brazil.

Who should buy this report?

  • Central banks, state printers and mints
  • Private sector organisations active in the management, processing, security and distribution of cash products
  • Suppliers of currency substrates, consumables and security features
  • Manufacturers of ATMs, cash handling and cash processing equipment
  • Business strategy consultants and analysts

Table of Contents

CONTENTS

1. Executive summary

  • Introduction and methodology
  • Report objectives
  • Report scope
  • Approach and methodology

2. The Survival of Cash

  • Pre-requisites for going cashless
  • Alternatives to cash payments
  • Card payments by banking systems
  • Mobile money and digital wallets
  • Virtual currency - Bitcoin
    • Legal assessment of Bitcoin
    • Assessment of blockchain technology
  • Benefits of cash payments
  • Complementary eco-systems for cash and non-cash payment
  • Debate about the reduce of cash payments
  • Regulatory pressure for payment charges
  • Composition of leading currencies
  • Trends affecting cash vs. cashless payment until 2026

3. The demand for currency in cash cycles

  • Challenges within cash cycles
    • Life cycle of currency
    • Wholesale cycle
    • Branch cycle
  • Cost of cash
  • Role of NCB within cash cycle
  • Structuring of banknotes and coins
  • Cash Cycle models
  • Trend to reduce NCB interventions in wholesale cycle
  • Operational performance in cash management
  • Optimising the cash cycles
    • Cash centre operations
    • Cash centre network organisation
    • Cash-in-transit and armoured car industry
    • Retail cash management
    • Cash management for retail banking
  • Trends of investment in cash cycle until 2026

4. Cash cycles for selected countries 2016-2026

  • Introduction
  • Germany
    • Relevance of cash for Germany
    • Status and development of the German cash cycle
    • Future requirements and trends for commercial cash cycle in Germany
  • Poland
    • Relevance of cash for Poland
    • Status and development of the Polish cash cycle
      • New series in Polish Zloty banknotes and coins
      • National Bank of Poland cash cycle modernisation
    • Future requirements and trends for commercial cash cycle in Poland 
  • Brazil
    • Challenges for Brazil’s economy
    • Relevance of cash for Brazil
    • Status and development of the Brazilian cash cycle
      • The Brazilian Real in coins and banknotes
      • The Banco Central do Brasil transfer model
    • Future requirements and trends for commercial cash cycle in Brazil
  • Conclusions

5. Future trends in currency design and production

  • Introduction Cost of cash
  • Requirements for banknotes – Fit for circulation
    • Methods for banknote design policy
    • Feature setting effects security and productivity of cash cycle
    • The durability of banknotes – The cost factor
    • Configuration testing
  • Requirements for coins – Fit for circulation
    • Frauds through counterfeits and foreign coins
    • Durability and weathering
    • Seigniorage versus coin identity and authentication in cash cycles
    • Technology of blanks as a differentiator
    • Set-up of security features for coins
    • Future developments in coins
    • Production technology and equipment for coin manufacturing
  • The banknote-coin boundary

6. Unmet demands and trends in cash cycles 2016-2026

  • Introduction
  • Automated processing of mixed banknote (paper and polymer) stocks
  • Growing use of ATM recyclers and branch automation
  • Interoperability of IT systems across future cash supply chains
  • Ink-dye technology for secure ATM and cash logistics
  • Elimination of small denomination coins through price rounding
  • Anti-counterfeiting technologies

7. Glossary and technical terms

8. Appendix

Tables and Figures

Tables & Figures:

  • Summary of Unmet demands and trends in cash cycles 2016-2026
  • World top 10 markets for banknote print volumes
  • Cash Payments for top 10 markets in the world and selected other countries
  • Split of payment share by spending category
  • Pre-requisites for cashless payment
  • Development of non-cash transactions
  • Pros and Cons of card-based payments
  • Split per transaction payment category
  • Pros and cons of mobile payments
  • Current process chain to approve and settle POS payments
  • Bitcoin market worldwide
  • Pros and Cons of Bitcoin
  • Pros and Cons of cash payments and storage
  • Costs for cash transactions in Western Europe/North America
  • ATM market growth/ATM transactions worldwide
  • Benchmark for cashless payment fees in western hemisphere
  • Benchmark for ATM transaction fees
  • Weight of international currencies in the IMF currency basket
  • Scenarios for EUR banknotes in circulation until 2026
  • Major printing plants for banknotes
  • Major mints for coins
  • Participants in national cash cycles
  • Cost structuring for cash infrastructure by stakeholder
  • Denomination structure of banknotes and coins for selected currencies
  • Position of European NCBs within cash cycle models
  • Specifications of European NCB cash cycle systems
  • EDI messages for cash supply chain
  • BPS M7 with automated shredder and packaging unit for NCB
  • Manufactures of high speed banknote and coin processing equipment
  • Interbank models with share services for cash operations
  • Improved business case for CiT logistics with ink technology for Western Europe, Australia, New Zealand
  • Attacks in Europe at armoured transport
  • US market analysis for smart deposit devices
  • Cost structure for self-service/ assistant self-service area
  • Global currency exchange rates
  • Circulation of Euro banknotes
  • Relevance of cash within Euro Zone
  • Reasons for Germans paying exclusively with cash
  • Cash payments in Germany, forecast until 2026
  • The cash cycle in Germany
  • Reduction of cash operations/ branches of the Deutsche Bundesbank
  • Coins in circulation within Euro Zone, linear forecast until 2026
  • Scenario for banking networks in Germany, forecast until 2026
  • Circulation of PLN currency
  • PLN banknotes in circulation, scenarios to 2026
  • PLN coins in circulation, scenarios to 2026
  • The cash cycle in Poland
  • Performance increase for NBP’s cash infrastructure
  • Banking structure of Brazil by ATM terminals
  • Trend for ATM market/ATM transaction in Brazil
  • BRL banknotes in circulation
  • The cash cycle in Brazil
  • User levels of security features
  • Project approach for banknote design change and technology renewal
  • Design functions and parameters of a banknote
  • Matrix positioning of new banknotes
  • Stability of measurement signals in security features over banknote lifetime
  • Lifetime of selected banknote series depending on denomination
  • Detected Euro counterfeits in Germany
  • Coin comparison €2 and Thai 10 Baht
  • Basic materials for coin blanks
  • Level-1 security features for coins
  • Scalloped bi-colour coin with outer polygon shape
  • “Flip-flop-coin” of Wickeder 
  •  New 5 Euro coin with polymer ring
  • Leading international suppliers for coin manufacturing equipment
  • Coin with 2-dimentional barcode graphic in the skier jacket
  • Automated process flow for banknote destruction with mixed substrates
  • ATM population including cash recyclers for banking sector worldwide
  • Approach for ATM supply chain involving cash 4PL-provider
  • ATM attack history of Sweden